In October, nothing will absorb the financial community’s attention more than the medium-term budget review. The "mini-budget" will be finance minister Malusi Gigaba’s first budget and the most challenging since the global financial crisis. The stakes are high: SA is at risk of getting trapped in a protracted period of weak growth which would worsen fiscal pressures and could land it in debt distress within five years. For the fifth year in a row, treasury has overestimated annual GDP growth. In February it projected that growth would recover to 1.3% this year on the back of better global trade, higher commodity prices and a rebound in agriculture.A full-blown rand crisis and deep recession, from which it could take many years to recover, could then develop. To avoid this, Gigaba is likely to signal that the next three years will require broad-based tax hikes; expenditure cuts across all departments; a lowering of the expenditure ceiling; and a big emphasis on rooting out wastage an...

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